IAPM10e_Ch_03投资分析题库要点.pdf

CHAPTER 3—SELECTING INVESTMENTS IN A GLOBAL MARKET TRUE/FALSE 1. The U.S. equity and bond markets have grown in terms of their relative size of the world equity and bond market. ANS: F PTS: 1 2. Diversification with foreign securities can help reduce portfolio risk. ANS: T PTS: 1 3. The total domestic return on German bonds is the return that would be experienced by an U.S. investor who owned German bonds. ANS: F PTS: 1 4. If the exchange rate effect for Japanese bonds is negative, it means that the domestic rate of return will be greater than the U.S. dollar return. ANS: T PTS: 1 5. A U.S. investor who ignores foreign markets reduces overall number of investment choices. ANS: T PTS: 1 6. Treasury bills are long-term investments that make regular interest and principal payments. ANS: F PTS: 1 7. A debenture is an option issued by a corporation that gives the holder the right to acquire common stock from the issuing firm at a specified price within a designated period of time. ANS: F PTS: 1 8. Income bonds are considered as safe as debentures because they pay higher rates of interest. ANS: F PTS: 1 9. A Eurobond is an international bond denominated in a currency other than that of the United States. ANS: F PTS: 1 10. Warrants are options often issued in connection with the sale of fixed income securities. ANS: T PTS: 1 11. A call option is usually issued in conjunction with convertible bonds. ANS: F PTS: 1 12. Yields on money market funds are often lower than yields available to individuals investing in CDs because of the fees involved. ANS: